FTSE 100 bosses see pay packets return to pre-pandemic levels

FTSE 100 chief executives in 2021 saw their median pay packet return to pre-pandemic levels at £3.6 million, but the year ahead could prove more challenging, according to Deloitte.

The Big Four accountant has unveiled a preview of its 2022 annual general meeting season report, and said that while total pay rebounded following 2020, it has stayed below the peak level seen in recent years – a high of just over £4m in 2017.

In 2020, median FTSE 100 CEO total pay fell for a fourth consecutive year to £2.78m after voluntary pay-cuts at the outset of the Covid-19 pandemic, slashed annual bonuses, and companies “heeding investor pressure to align executive pensions with rates available to the wider workforce”, Deloitte said.

The professional services firm added that the return of higher CEO pay packages in 2021, during which the FTSE 100 index rallied by more than 14 per cent, can be attributed to a rebound in annual bonus and long-term incentive out-turns.

Stephen Cahill, vice chairman at Deloitte, said: “UK listed companies are subject to the highest remuneration governance standards globally, and the UK has not followed countries like the US in terms of executive pay inflation in recent years. In general, we have seen investors and proxy agencies supportive of pay decisions in 2021.”

However, he warned that a troubled backdrop means that the year ahead could be more difficult. “Investors will rightly hold companies to account where performance does not justify payouts, or where executives are seen to be insulated from the wider employee experience. Balancing fairness and competitiveness will play a part in the long-term success of London’s capital markets.”